Which of the Following Describes a Benefit Enjoyed by Investors

question 378

Multiple Choice

Which of the following describes a benefit enjoyed by investors in mutual funds?

• A) Guaranteed dividend payments are received annually.
• B) Investment risk is eliminated.
• C) Investors buy an ownership interest in many different companies.
• D) Investors exercise managerial authority in many different companies.

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Definitions:

Marginal Product

Marginal product is the increase in output that results from adding one more unit of a specific input, holding all other inputs constant.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.

Law Of Diminishing Returns

An economic principle stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.

Fixed Factor

A resource in the production process that remains constant, regardless of the level of output or production over a certain time period.